Americans CANNOT afford to buy a home | Morris Invest

This is an absolute tragedy what's happening in the United States right now. Americans cannot afford their homes. It's no secret that housing prices have skyrocketed over the past few years. In fact, home prices up 40% since the beginning of the pandemic and a recent article from Bankrate, Bankrate's 2024 home affordability index, shines a light on how dire this situation has gotten for Americans. In fact, today's homebuyers are being priced out of the market with major contributing factors being, of course, low inventory, high interest rates, high prices, and aside from this data from Bankrate.com, the soaring insurance rates, taxes, other additional costs are adding up quickly for American homeowners right now. They found that it now costs up to $18,000 more per year to own a home in America, and that's excluding the mortgage payment. That's just all of the other expenses. That same metric in 2020 was $14,000. It's not news that everything has gotten more expensive in just the last four years, but home ownership just keeps getting more and more out of reach for most Americans. I remember a recent story where I saw a young woman in her 20s sitting at her parents' house on the back porch, and it was around a lake. It was like up in, you know, Pennsylvania Mountains or something like that in the Pocono Mountains, and she was talking about how she grew up here. Her parents were both teachers. They afforded this beautiful house on this lake, you know, and it was not a huge house, but they had a great, comfortable life, and she said now she's in her 20s. There's no way that she, as an employed person with a job, could even come close to affording this same house. Times have changed, so now these children don't have access to the same things that we did 20, 30, 40 years ago, and bank rates studies show that 78% of adults who don't own a home, but want to, cite affordability reasons as the major factor influencing their housing situation. I mean, 56% of participants said they don't have enough income to buy a home. 47% said the home prices are prohibitive. So at its core, the affordable housing crisis comes down to a major supply and demand issue. Listen to what real estate legend Ken McElroy had to say when I had a chance to talk with him just a few weeks ago right here on the show. Listen. Generally, there's a massive displacement and a short shortage of housing in the US that actually started in 2007, 2008. So from that, if you go back and look at 2007, 2000 to say 17, let's say that 10-year window, you remember what was going on, you know, the single families were going back and multifamily was in trouble and the banks were not lending. Well, people still were being born and you know, so all those folks that need housing now, we had a huge shortage period of almost that 10-year period. And we need, you know, about a million units a year to, you know, just to be added to the economy just to keep up with population growth. So that 10-year period kind of created this little run we just had. We're starting to get back, but then the interest rate rise really had a lot of people pull back. And so we're going to hit a massive shortage again in 26, 27, 28 and the politicians, once again, will be significantly behind this. They won't even see what's coming. Yeah, you heard that right. This shortage is only going to get worse in the coming years, which is why I'm always surprised to get pushback when I mentioned that I'm investing in real estate right now. Maybe some people figure that the economy and the housing market are going to, I don't know, regulate at some point, but I wouldn't bet on that, especially when you look at interest rates. I would not be holding out for pre-pandemic numbers at all. In our lifetime, it's very unlikely that we will see mortgage rates to the tune of 3 to 4% again. And the truth is, even if interest rates were to go down significantly, there's still the long-term issue of lack of supply. Interest rates alone cannot solve the affordable housing crisis. We'll get back to that video in a minute. But first, I need to tell you about a golden opportunity for investors that's happening right now. Mortgage rates have plummeted in anticipation of the Federal Reserve cutting interest rates at their upcoming meeting in September. Now, it's good news for buyers and it has presented a unique overlap in the investing world right now. Remember when mortgage rates spiked last year? Well, a lot of sellers started offering incentives to help investors achieve positive cash flow. For example, my company, Morris Invest, and our team over at Sedera Wealth started offering clients a rate buy-down credit. Now, a rate buy-down drastically reduces your mortgage payment. If you've ever run the numbers on an investment property, you know that's a big deal. Now, here's where the golden opportunity comes in. When mortgage rates change, it can take a while for other things like seller incentives to start catching up. So even though you can get a mortgage rate in the low sixes right now, and that could be even lower by the time you're seeing this video, right now you can also lock in a rate buy-down credit on top of that. And this is huge, people, huge. With the two combined, our team's finance experts said he's seeing our clients locking in rates he hasn't seen in years. But here's the catch, the window of opportunity here is very narrow. This overlap will close very soon. So those seller incentives are going to fall off. Very, very soon. There are two more reasons to move quickly on this. One, prices are rising week over week. And now that rates are going down, they're going to spike even more dramatically, which will be made worse by two, increasing competition. Potential buyers have been sitting on the sidelines just waiting for rates to drop. And now that they have, they're going to flood the market, reproduce bidding wars, pushing prices even higher. If you need a refresher on the advantages of owning real estate, like how it delivers four streams of income through number one, appreciation and equity gains, number two, principal reduction by your tenants, number three, tax benefits and depreciation, and number four, cash flow. I'll link another video in the description so you can check that out. But if you've done your research and you already understand why build to rent properties in high-growth rental markets are a great path to financial freedom, then take action right now. You do not want to miss out on this opportunity to fast-track your investing strategy. Cash in on this narrow overlap of lower rates and seller incentives while it's here. Click the link below and schedule a free call right now. It could be the most important call you make this year. As I've been saying for years, smart investors are always buying tangible assets. While it's true that it's harder to buy right in these market conditions, it's not impossible to buy right. And I won't pretend that this is an ideal climate for investing. Rates are high, prices are up, and supply is dramatically low. But it's only going to get harder to buy real estate in the coming years. As we watch the middle class slowly disappear into oblivion, it is a critical time to be building your wealth so you don't get left in the dust. Smart investors realize the affordable housing crisis is actually an opportunity to add supply to the market and offer fair rental prices to tenants who need to rent. Next up, I'd love for you to check out this full interview that I did with Ken McElroy where we discuss more about the affordable housing crisis, how illegal immigration is impacting the housing market, and the crash of commercial real estate. Just click right here and I'll see you in that video with Ken.